BJC invests in fund for Black- and Latino-owned businesses

A new investment fund for minority-owned businesses in the St. Louis area is backed by one of the region’s largest employers.

BJC HealthCare and WEPOWER Capital announced a collaboration on Wednesday to support Black- and Latino-owned businesses.

Financing the healthcare system, The unspecified funds will go into a pilot fund managed by WEPOWER, a non-profit organization working to build political and economic power in local communities of color.

Christopher Nolan, BJC’s Director of Anchor Initiatives and Community Health Improvement, said, “This is committed to improving and addressing the racial wage and wealth gaps we see in our region. It is very consistent with our work.

He explained that this investment is an opportunity for his organization to impact the health and well-being of communities by focusing beyond direct clinical care on things such as economic and social health.

“We want to start looking at what’s going on outside the walls,” said Nolan. “Healthcare organizations are looking at what’s going on in people’s daily lives and are starting to see that they understand there are other factors.”

WEPOWER Capital is a way to create intergenerational wealth and other opportunities for historically underserved parts of the region, he said.

BJC donations and other donations bring the total fund to $1.5 million, Investing in high-growth Black and Latinx businessessaid Yoni Blumberg, Vice President of Community Wealth Building at WEPOWER.

The fund does not require entrepreneurs to have a specific credit score or provide personal collateral, unlike most forms of investment.He said.

“We see these racially disparate impacts and believe there are better ways to assess the risk of investments,” said Blumberg. “The primary way we invest in companies is through unconventional financial instruments – earnings-based investments.”

Instead of paying a fixed monthly amount like a typical bank loan, payments are based on last month’s income, he said. This creates an incentive for WEPOWER to support the venture’s continued growth and success, Blumberg explained.

“It’s also different from venture capital because it doesn’t require the entrepreneur to relinquish much of their ownership like an equity investment from a traditional venture capital firm,” he added.

All of this is designed not to undermine the autonomy of Black or Latino entrepreneurs, and ultimately aims to encourage ventures to stay in the community rather than go to private equity firms, says Blumberg. says Mr.

WEPOWER Capital has an investment committee made up of entrepreneurs of color, local residents, and people with traditional financial and investment backgrounds who will review potential ventures, he said. Stated.

“We try to find good deals, good prospects and take them, but then we try to bring them to the investment committee,” Blumberg said. “This is a step towards making our investments more accountable to the community.”

He admits it’s an unconventional approach and explains why the initial pilot funding is only $1.5 million at this point. The idea is to demonstrate small-scale success before growing it, which makes his BJC support substantial at this point, Blumberg said.

“It’s really exciting to see them show interest and a desire to work together,” he said. And instead of shying away from it, we are critically considering what we can do to improve health outcomes in our local communities.”

Nolan shared similar sentiments.

“We are focused on thinking about how our investments can impact the region,” he said. No, we are rooted in the community.”

Eric Schmid responsible for economic development of St. Louis Public Radio

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